HOUSTON – Breitburn Energy is buying QR Energy LP in a deal worth about $1.46 billion.
QR unitholders will receive approximately 72 million common units of Breitburn Energy Partners LP, or 0.9856 of a Breitburn unit, for each unit of QR Energy that they own. The consideration to be received by QR unitholders is valued at $22.48 per unit, a 19 per cent premium to Wednesday’s closing price of $18.87.
Shares of Houston’s QR Energy rose more than 8 per cent before the opening bell Thursday.
The companies put the transaction’s value at approximately $3 billion, including QR’s existing debt and outstanding convertible preferred units.
The senior management team at Breitburn Energy Partners LP will lead the combined business. Once the transaction, closes Breitburn will add a new director to its board that is mutually agreed upon by both companies.
The boards of both companies unanimously approved the deal, which is targeted to close later this year or in early 2015. It still needs approval from QR unitholders.